Although the microfinance movement has developed rapidly in Bangladesh over the last three decades, there has been little research on the wider contributions of microfinance to the livelihood of its clients. Moreover, there is no consensus in the microfinance literature that has attempted to control for selection bias. Therefore, to fill up this gap in the literature, this study examines the impacts of microfinance on income and consumption of households in Bangladesh that ultimately lead to poverty reduction. The main objective of this paper is to examine the effects of microfinance on the economic welfare of member households using a quasi-experimental survey pioneered by Coleman (1999). The data were collected across 20 villages in four districts of Bangladesh using quasiexperimental survey approach. The sample was designed so that member households of microfinance programs were compared with non-member households of similar characteristics. In the survey, member-households were sampled from a list of microfinance members in each village. For nonmember households, the sample frame consists of households who own less than half an acre of land and were ranked as poor by village heads. The total number of households interviewed was 439, or about 22 households per village. Two sets of pre-tested structured questionnaires were administered to the sample households. In our econometric analysis, economic wellbeing is proxied by the measures of household income and consumption. The empirical results indicate that microfinance members remain poorer than non-members. But participation in microfinance has positive impacts: one percent increase in the duration of microfinance membership is associated with an increase of income and consumption per adult equivalent by 0.19 and 0.16 percent, respectively. Also, an additional month of participation in microfinance is associated with the lower probability of being poor (using $1.25 PPP per person per day) by 7 Percentage points. Our results suggest that the overall impact of microfinance operations on the economic well-being of the microfinance participants is positive. Microfinance participants' economic well-being as proxied by income and consumption JEL Classifications: I32, I38, O18

This paper examines the extent to which participation in microfinance programs improves health service uses and health-seeking behaviour of participants. The study collects and analyses data from 439 households across 20 villages of four districts covered by three popular microfinance programs in Bangladesh. Our results suggest that participation in a microfinance program is positively associated with improvements in health services uses and health-seeking behaviour. Participation in microfinance programs is found to be associated with significant improvement in three health-related issues: antenatal care, diarrhoea remedial, and immunisation. A positive association between participation in microfinance and other health service uses is also found with weak statistical evidence.

This paper investigates the impact of microcredit programs on child schooling in rural Bangladesh using cross-sectional data from 439 households across 20 villages of four districts of the country. A child's school outcomes are measured by school enrolment, school attendance and grade attainment (measured by the right grade for age). Our results reveal that participation in microcredit programs has a significant positive effect on school attendance but no effect on either school enrolment or grade attainment, suggesting that care should be taken in assessing the effectiveness of microcredit programs. Despite the fact that microcredit programs can alleviate poverty and contribute to the rural economy, these can also result in unintended consequences such as adverse effects on children's schooling.Policies aiming to improving the children's educational achievement in rural households should consider providing or enhancing subsidized educational stationery and meals besides providing free universal education among the children of microcredit participants.

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